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So is the Affordable Care Act, on the surface, really good for you? Probably not, but it is fantastic for the federal government, terrific for state governments that tax income, and an absolute dream for Wall Street and Corporate America.

A few of the stated goals of the Affordable Care Act (ACA) are that it will lead to an increase in job growth, jump-start the economy, bring back manufacturing to the United States, and yes it will, even, pay down the deficit.

Believe it?

As more information is being disseminated each day about the ACA, the one tidbit that everyone may still remember is the simple fact that companies with more than 50 employees will be fined $2,000 each year for each employee who is not provided health insurance.

Sounds like a big fine, doesn’t it? But think about it, companies that provide health benefits for employees tend to pick up a large portion of that premium, and that portion is usually much higher than that fine of $2,000.

According to the Kaiser Family Foundation, in 2013, the average annual premiums for employer-sponsored health insurance were $5,884 for single coverage and $16,351 for family coverage, while the employee contribution for this coverage was “on average, 18 percent of the premium for single coverage and 29 percent of the premium for family coverage.”

The math would determine that employers, on average, paid $4,824.88 per individual health plan and $11,610 for every employee who opted for a family plan.

Now, with the new rules provided by the ACA, employers can “opt out” of this benefit and face a fine of $2,000 per employee. The savings have the potential to be immense since, also, according to another Kaiser Family Foundation report, “Employer Health Benefits," there were 149 million people covered under an employer health plan as of 2011, with roughly 54.7 million covered by an individual plan and the remaining 94 million covered by a family plan.

From these numbers it can be concluded that, on average, employers spent about $1.2 trillion each year for family health premiums and close to $264 billion in individual health premiums each year — for a total of roughly $1.4 trillion in premiums for the year.

Think about it, if employers just decided to pay that $2,000 fine for every single person, including the spouse and dependents of their employees (which they don't have to do), how much would that bill total? Close to $298 billion. The savings would easily be $1.1 trillion (149 million x $2,000).

This would leave employers throughout the United States with an extra $1.1 billion that can be added to their bottom line, which could be used to prop up the share price of a company stock. And hasn’t Wall Street now become a leading indicator on how well the U.S. economy is doing?
The other great news could quite possibly be that, instead of that $1.4 trillion heading to insurance companies in the form of premiums, it would now be held at the corporate level where it could easily be pumped back into the economy through employer spending, which, in time, would also be taxed accordingly by the federal government.

And that fine of $2,000 per employee? Well, that will also be sent to the federal government, which could quickly be labeled as “new” revenue.

As for manufacturing coming back to the United States? Well, now with the second-largest expense employers face being magically erased, the costs of each employee having nowhere else to go but down, and shipping materials to countries like China and India
appearing to be not that sensible (especially if the cost of employees in those countries begin to rise) — all one needs to do is look at the Wall Street Journal China report on rising employee costs to see what is happening globally.

Now, is it also so hard to see how jobs could be increased in the very near future?

In one fell swoop, the ACA could possibly free up $1.4 trillion in revenue for companies throughout the United States, and all it will cost
these companies, at a maximum, $298 billion in fines. But, who in the end will really pay for it anyway?

For those who define the country as people and who may also find that previous question irritating, the ACA may not be the best piece of legislation ever created, and the reason should be glaringly obvious: Employees will be the ones paying for this, as they will no longer have access to employer-funded health insurance.

Yes, there will be people saying that at least they can go on the exchange and that health care will be the same for everyone, but please consider the other little nugget as well:

Under the former rules of health coverage, before the ACA, the amount of a person's premiums was, for the majority of Americans, taken out of their paycheck pre-tax, which lowered the amount of income the government could tax a person. Now, with the ACA, people will have to pay for their coverage after their income is taxed by the government.

The good news for you: You get to pay more in taxes to the government, and for those who do have a family, things may even get a little more difficult as the ACA has created a provision that children under the age of 26 are still the responsibility of their parents' health coverage.

So is the Affordable Care Act, on the surface, really good for you?

Probably not, but it is fantastic for the federal government, terrific for state governments that tax income, and an absolute dream for Wall Street and Corporate America.

The only truly amazing thing about the ACA is how we as a nation dealt with it. Those on the right, who tend to be for companies and the stock market, were and are still dead-set against the ACA, while those on the left, who despise big business and Wall Street, are the ones who are all for it.

As the nation focuses on this new law, it has to be stated that it was absolutely genius how one man convinced the majority of Americans that we as a nation must allow companies to make more money each year, even if comes at a price of our own health. Really? Only in America would people allow this to happen.

About the Author

Dan McGrath, author of "What you don't know about retirement will hurt you!” is one of the country's leading experts on how the high costs associated to healthcare will impact retirement, Social Security and the overall economy.
Mr. McGrath is the Co-Founder of both Jester Financial Technologi... More